Davis v. King

• Decision Date: 19 July 1895
• Citation: 66 Conn. 465,34 A. 107
• Court: Connecticut Supreme Court
• Parties: DAVIS v. KING.

34 A. 107

66 Conn. 465

DAVIS

v. KING.

Supreme Court of Errors of Connecticut.

July 19, 1895.

Appeal from superior court, Windham county; Ralph Wheeler, Judge.

Action by George R. Davis against Charles D. King to recover damages for the conversion of a note. From a judgment for plaintiff, defendant appeals. Reversed.

John C. Chamberlain, for appellant.

Charles E. Searls, for appellee.

TORRANCE, J. This is an action to recover damages for the conversion of a note. The court below made a finding of facts, and upon those facts rendered judgment for the plaintiff, and from that judgment the defendant brings the present appeal.

The following is a somewhat condensed statement of the facts found: On and before June 1, 1890, the defendant was in business in Danielsonville, in this state, under the name of C. D. King & Co., and advertised himself, under that name, as an investment broker and negotiator of Southern loans. He continued said business there under that name down to the time of the trial. About June 1, 1890, the plaintiff, at the solicitation of the defendant, purchased of him the note in question. It was dated June 1, 1888, for the sum of $1,000, signed by one Colley, payable to the order of the Georgia Loan & Trust Company, and due five years from date, with interest at 8 per cent., payable semiannually. It was indorsed by the Georgia Loan & Trust Company to the defendant, and by him to the plaintiff. No mortgage deed or other papers accompanied the note, and the plaintiff never saw any papers other than it, although he understood that the note was secured by mortgage to the loan and trust company on certain real estate situated in Georgia. The note sold to the plaintiff was one of three notes of like amount, tenor, and date, made by Colley, in June, 1888, to said loan and trust company, for a loan of $3,000 then made by it to him, and all three notes were secured by one and the same mortgage deed of trust, made by Colley to said company, upon land of his in Georgia. The company desired to have the notes made in three amounts for convenience in selling, and for the purpose of negotiating them. The court finds that the plaintiff did not know, until after the maturity of the extension coupon hereinafter referred to, that any other notes than his own were secured by said trust deed, but there was a statement of that fact upon his note. When the note came due, the plaintiff, at the request of the defendant, consented to an extension for three months, and subsequently received, through the defendant, an extension coupon to cover the interest of said three months, and dated June 1, 1893, which coupon was afterwards paid. Prior to this time, the defendant had collected for the plaintiff the interest coupons upon this note as they came due. The defendant did this through the firm of Burr & Knapp, of Bridgeport, in this state, who were investment brokers, and one of whom was the president of the Georgia Loan & Trust Company, and the Connecticut office of that company was in the office of Burr & Knapp, who were its general managers in this state. Where the Georgia company was located, or any other facts concerning it, the evidence did not disclose. The defendant, among other loans, handled those of this Georgia company, through Burr & Knapp, but under what arrangement did not appear. The coupons upon plaintiff's note, as they came due, were sent by defendant to Burr & Knapp, and the money, when received by them, was sent to the defendant, and paid by him to the plaintiff. When the extension coupon came due, the note remained unpaid, and the plaintiff, on September 20. 1893, "at the solicitation of the defendant, and relying upon his assurance that, if he would give the defendant the note for collection, the defendant would get the amount due upon it in a very short time, delivered said note to the defendant with positive instructions to collect the amount due thereon, and received from him a receipt therefor, reading as follows: 'Received of George R. Davis note 2,441, Georgia Loan, 1994, for $1,000, for collection. Matured Sept. 1, 1893. Placed in our hands at first on Sept. 20, 1893. C. D. King & Co.'" Nothing was said between the parties as to any compensation to be paid the defendant for the collection of said note, and he never expected anything would be paid, unless some difficulty arose in making the collection; but the plaintiff understood that the defendant would attend to its collection, as he had attended to the collection of coupons, as a duty assumed by him, as the negotiator of the loan, towards the plaintiff, as its purchaser, for the promotion of his brokerage business. No instructions were given to the defendant as to the course to be pursued in collection. The defendant at once sent the note to Burr & Knapp, and instructed them to collect the same and remit the money to him. Prior to this time the trust company, with the consent of the holders of the other two Colley notes, had agreed with Colley to extend the loan for a period of five years. Colley had executed three new notes, and a new mortgage of the same land, to secure the new notes, to a company' called the Security Investment Company; but what this new company was, or where located, the evidence did not disclose. It was the judgment of the trust company that it was for the interest of the holders of the original Colley notes that the first mortgage should not be foreclosed. These facts were unknown to the plaintiff when he placed his note in defendant's hands for collection, nor were they discovered by him for a long time thereafter. Burr & Knapp, on receipt of the note, forwarded it to the trust company, and it at once delivered the note to Colley, and it was by him presumably destroyed. The three renewal notes were payable in five years from date, with interest at 7 1/2 per cent. per annum, payable annually. One of these renewal notes was sent by Burr & Knapp to the defendant, and he tendered it to the plaintiff, who refused to accept it, and demanded the original note or the money due on it. The plaintiff, then, for the first time, learned of the existence of the firm of Burr...